The
California Institute for Federal Policy Research
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http://www.calinst.org
California Capitol Hill Bulletin
Volume 8, Bulletin 18 — June 8, 2001
[or
see pdf version]
Diane Watson Wins 32nd Congressional District Seat; Hahn Wins Mayoral Race
House Energy & Commerce Committee Leadership Scuttles Electricity Bill
President Signs Tax Bill; R&D Dropped; Section 127 Expanded
President Seeks NTR For China; Senate Chair Says TPA May Slip
Governor Announces $32 Million In CALFED Grants and Loans
California Resources Bills Clear House
Resources Committee Holds Hearing on Energy Policy
Letter Seeks to Fund Last Year’s Education Compromise
Report Released on the State of California’s Regions
Crime Rate Leveling Off: California Has Nation’s Safest Cities but also Leads in Gang growth
CDC Report Released: Investment in Tobacco Control
Hollywood Writers Ratify New Contract
DOE To Receive $1.4 Million to Plan For Moab Uranium Tailings Move
Congress Approves Naming Federal Building for Late Rep. Corman
Former Rep. Rogan Nominated To Head Patent & Trademark Office; Caldera to Join CSU
Agricultural Producers Urge President Not To Negotiate U.S. Trade Protection Laws
Diane Watson Wins 32nd Congressional District Seat; Hahn Wins Mayoral Race
In a special election on Tuesday, June 5, Democrat Diane E. Watson was elected to the 32nd District Congressional Seat, replacing the late Democratic Representative Julian C. Dixon who died December 8, 2000. The 67 year-old Watson most recently served as Ambassador to Micronesia under the Clinton administration. She was also the first African-American woman to serve in the California Senate, elected in 1978 and serving 20 years. Watson defeated Noel Irwin Hentschel with 74.8% of the vote. She was sworn in to Congress on Thursday, June 7.
Also on Tuesday, long-time Los Angeles City Attorney James Hahn was elected Mayor of Los Angeles. Hahn, 50, who has served 20 years in city government, defeated former State Assembly Speaker Antonio Villaraigosa in a close run-off election.
House Energy & Commerce Committee Leadership Scuttles Electricity Bill
After scheduling and rescheduling a markup on the bill, the leadership of the House Energy and Commerce Committee this week gave up their effort to produce an emergency electricity bill for California. Full committee chair Billy Tauzin (LA) and Energy and Air Quality Subcommittee Chair Joe Barton (TX) announced on Wednesday that they were unable to reach agreement with Democrats over whether or not to include price control measures in the bill. The leaders commented that said several provisions in the bill, including initiatives related to power lines and low-income energy assistance, are already being implemented by President Bush and California Gov. Gray Davis.
Republican leaders had intended to offer a compromise developed by Rep. Doug Ose, (Sacramento), chair of Government Reform Committee’s energy panel, which would have set electricity prices based on the marginal cost at the least-efficient (and thus most expensive) power plant selling into the market. While the FERC proposed setting such rates during power emergencies, the Ose bill plan would have imposed those rates at all times.
Rep. Henry Waxman (Los Angeles), a senior Democrat on the Energy and Commerce Committee, stated that he and colleagues have begun a discharge petition seeking to require the House to consider a wholesale price mitigation proposal.
In the Senate, the new chair of the Governmental Affairs Committee, Sen. Joseph Lieberman (CT), has announced his intention to hold a hearing with members of the Federal Energy Regulatory Commission regarding FERC’s actions on the California electricity crisis. Lieberman is a cosponsor of Sen. Dianne Feinstein’s bill to require that FERC to impose price caps or cost-of-service rates on in the California market.
Sen. Jeff Bingaman (NM), who took over this week as the new chairman of the Senate Energy and Natural Resources Committee, said that he would give FERC two weeks to take action to control prices in the California market before he would seek legislation to impose price caps or other interventions, presumably Sen. Feinstein’s bill to set rates based on the cost of service plus a reasonable profit. Bingaman is a cosponsor of that bill.
President Signs Tax Bill; R&D Dropped; Section 127 Expanded
President Bush on Thursday, June 7 signed the $1.35 trillion tax plan, passed by Congress before the Memorial Day recess. In addition to the major provisions of the bill regarding tax rate cuts, and repeal of the estate/death tax, other provisions of particular importance to California where considered during debate and negotiations on the measure. See, Bulletin, Vol. 8, Nos. 16 (5/17/01) & 17 (5/24/01). For instance, the signed law makes permanent and expands to graduate education the tax benefits provided under Section 127 for employer-paid education expenses, for courses beginning after Dec. 31, 2001. This provision has been supported for years by California’s high technology industry.
On the other hand, the Senate-adopted provision which would have made the R&D tax credit permanent was dropped during conference. The current credit is set to expire in 2004. A permanent extension of the credit has been strongly supported by a bi-partisan majority of the California delegation, under the leadership of Reps. Bob Matsui (Sacramento) and Wally Herger (Marysville).
A detailed summary of all the provisions contained in the bill can be accessed through the Joint Committee on Taxation’s website at: http://www.house.gov/jct/x-50-01.pdf.
President Seeks NTR For China; Senate Chair Says TPA May Slip
As expected, this week President Bush announced that he would extend China’s Normal Trade Relations status for another year. The one-year extension is required because China has not yet acceded to the World Trade Organization (WTO), and the United States’ grant of Permanent Normal Trade Relations is contingent on WTO membership. Congress will have 90 days to pass a resolution of disapproval, although it is expected that the one-year extension will be granted.
In other news, Sen. Max Baucus (MT), new Democratic Chairman of the Senate Finance Committee, stated this week that Senate consideration of trade promotion authority (TPA -formerly known as "fast track") may not take place this year. Although saying he would push for it this year, Baucus added "it may slip to next year." The House hopes to take up the legislation perhaps as early as this month. TPA would give the President the authority to negotiate trade agreements with U.S. trading partners that could not be amended by Congress.
Governor Announces $32 Million In CALFED Grants and Loans
On Monday, June 4, Governor Gray Davis announced $32 million in grants and loans to numerous studies, programs, and projects approved by the CALFED Bay-Delta Program to improve California’s water resources and management.
The grants come from Proposition 13 (the Safe Drinking Water, Clean Water, Watershed Protection, and Flood Control Bond Act) and from Senate Bill 23 (authored by Sen. Jim Costa (Fresno)). $12 million of the total is under SB 23 for Water Use Efficiency Grants. Almost half of the money is earmarked for the San Joaquin Valley to benefit the Central Valley’s efforts to create water storage and conserve water supplies. $18.5 million in Prop 13 grants goes for groundwater storage and recharge and another $1.5 million for urban water conservation loans and feasibility study grants. The overall program encompasses more than 90 projects with the total cost reaching more than $96 million. The state grants and loans will be used to leverage local contributions.
A complete breakdown on the funded projects can be accessed through the Governor’s website at http://www.governor.ca.gov/state/govsite/gov_search_results.jsp.
California Resources Bills Clear House
On Wednesday, June 6, the House passed by voice vote H.R. 640, which amends the National Parks and Recreation Act of 1978 to adjust the boundaries of the Santa Monica Mountains National Recreation Area in California. Reps. Elton Gallegly (Simi Valley) and Brad Sherman (Sherman Oaks) introduced the legislation. The bill will enhance and protect the principal wildlife corridor in the urban area between the Simi Hills to the north and the Santa Monica Mountains. It adds nearly 3,700 acres of public and private lands to the Recreation Area at no cost to the taxpayer. Of that, 2,797 acres donated to the Santa Monica Mountains Conservancy, a state agency, will be transferred to the National Park Service. Another 570 acres is publicly and privately owned open space. The rest, about 330 acres, is comprised of developed residential areas in the cities of Calabasas and Agoura Hills. The rights of private property owners and municipalities within the designated area would not be affected by H.R. 640.
The House also passed H.R. 1661, introduced by Rep. George Miller (Martinez), which will give California, Washington, and Oregon indefinite authority to manage a Dungeness crab fishery until the effective date of a fishery management plan for the fishery under the Magnuson-Stevens Fishery Conservation and Management Act. The measure passed by voice vote.
The House also passed by voice vote a bill (H.R. 37) to authorize the National Park Service to update the feasibility and suitability studies of the Oregon, Pony Express, California, and Mormon national historic trails and provide for possible additions to them.
Resources Committee Holds Hearing on Energy Policy
On Wednesday, June 6, the House Committee on Resources held a full committee hearing on energy policy. Providing testimony at the hearing was the Secretary of the Interior, Gale Norton. The purpose of the oversight hearing was to examine legislative and administrative proposals in the National Energy Policy Report released by the Bush Administration on May 17th.
The report identified the following five national goals to implement the Administration’s policy: 1) increase conservation by applying existing technologies on a larger scale; 2) modernize existing energy infrastructure by removing regulatory hurdles, expediting permits for new projects, and enacting comprehensive electricity legislation that promotes competition; 3) increase energy supplies from diverse sources including fossil fuels, hydropower, nuclear and non-hydro renewable resources in order to reduce dependence on foreign sources of energy; 4) accelerate the protection and improvement of the environment through development and transfer of new technologies; and 5) make energy policy a priority of U.S. trade and foreign policy.
In his opening statement, Chairman James Hansen acknowledged the criticism the Administration has received for its energy policy, placing too much emphasis on development of existing resources and not relying enough on conservation or emerging technologies. He disputed the criticism, indicating that while California has the most intensive and rigorous conservation programs in the country, it’s current energy crisis is evidence that conservation alone does not constitute sound energy policy. He also praised California for having the lowest per capita energy consumption in the nation.
In her testimony, Secretary Norton defended the Administration’s energy policy, indicating the energy plan will increase energy production and improve the environment. She pointed out that more than half of the domestic recommendations in the National Energy Policy Report are targeted to conservation, environmental protection, and renewable and alternative energy. During questioning by Rep. George Miller (Martinez) regarding offshore oil exploration, Secretary Norton left open the question of whether the Administration would allow for additional leasing activity for areas off the Santa Barbara coast not covered by the current moratorium on exploration. To review Secretary Norton’s testimony in its entirety, please visit the Committee on Resources website at http://resourcescommittee.house.gov .
Letter Seeks to Fund Last Year’s Education Compromise
Congressman Randy "Duke" Cunningham is circulating among his California delegation colleagues a letter addressed to the leadership of the House Appropriations Committee seeking to ensure that any FY01 supplemental appropriations bill includes funds to pay for a Title I hold harmless compromise brokered last fall.
As the negotiations over FY01 appropriations came to a close in December 2000, a compromise was struck in the Labor-HHS-Education bill to include extra funding for California and other growing states which have been harmed by the so-called "100% hold harmless" on federal Title I education dollars, which has been engineered by slow-growing states in order to maintain their Title I funding levels despite the faster rise in child poverty in California and other fast-growing states. At the time the compromise was struck, its exact cost was not known. It now appears that roughly $161 million in supplemental Title I funding for FY01 will be required to fully fund the deal, approximately $22 million of which would come to California.
The letter to Chairman Bill Young (FL) notes that under the FY01 conference report each state should receive "the greater of either the amount it would receive at specified levels under the 100 percent hold harmless contained in the Senate bill or what it would receive using the statutory formula", but it notes that the funding in the bill was inadequate to accomplish this goal. The letter is different and distinct from another California circulated by Rep. Cunningham (see Bulletin, Vol. 8, No. 17 (5/25/01)) which seeks to ensure that no 100% hold harmless is applied to the FY02 appropriations bill for Labor, HHS and Education.
For more information, contact Erin Strawn with Rep. Cunningham’s office at x5-7615 or [email protected] .
Report Released on the State of California’s Regions
The California Center for Regional Leadership recently released the first annual report The State of California’s Regions, 2001: A Report on the New Regionalism in California (SOCR 2001). The report describes the challenges and opportunities faced by California’s communities and regions, including such issues as population growth, the new economy and the divide between the state’s rich and poor. The report defines and describes the state’s New Regionalism, which brings together various public, private and nonprofit sectors and other citizens into dialogues about the future of communities on various levels, including economic, environmental and social.
It also describes the work of a new organizations, called Collaborative Regional Initiatives (CRIs), which bring together civic entrepreneurs and other like minded citizens regarding a variety of issues. In the northern region of the state, CRIs include the Institute of the North Coast and the Sierra Business Council. In the central portion of the state, examples listed are Sonoma County Vision, Valley Vision/RAP, Bay Area Alliance for Sustainable Development, Tri-Valley Business Council, Joint Venture: Silicon Valley Network, Santa Cruz Region Cluster Project, Action Pajaro Valley, and Fresno Business Council. In the southern part of the state, examples of CRIs include the Santa Barbara Region Economic Community Project, Economic Alliance of the San Fernando Valley, San Gabriel Valley Economic Partnership of Commerce & Cities, Gateway Cities Partnership Inc., Inland Empire Economic Partnership, Metropolitan Forum Project, South Bay Economic Partnership, Orange County Business Council, San Diego Dialogue, and San Diego Regional Economic Development Corp.
It notes that there are many directions that the future of the state can take, depending on how it addresses myriad issues. To view the report in its entirety visit http://www.calregions.org .
Crime Rate Leveling Off: California Has Nation’s Safest Cities but also Leads in Gang growth
According to recently released FBI data, the unprecedented drop in crime nationally has come to an end, with a slight increase in violent crime of 0.1 percent in the preliminary 2000 figures relative to the 1999 figures. In some Western states including California, there was a slight 1.1% increase in the number of serious crimes from 1999 to 2000, the first increase since 1991.
While some California cities, like Fontana, Fresno, Pasadena and Burbank, experienced a rise in crime between 12.8% and 14.2%, other cities, like Oakland, San Jose and San Diego, continued to show a decline. Also according to the FBI data, of the cities with at least 100,000 residents, nine of the top 10 cities having the lowest crime rate are in California, with Simi Valley ranking number one. Other cities ranking in the top ten include Thousand Oaks, Santa Clarita, and San Jose at number ten. Orange County is home to six of the top 25 cities with the lowest crime rate.
Despite the high rankings of some California cities in terms of lowest national crime rates, California leads all states with the number of communities reporting gang problems, according to a study recently released by the Justice Department. According to this report, entitled The Growth of Youth Gang Problems in the United States: 1970-98, 363 communities in California reported gang problems in 1998. Within California the counties with the most communities affected by gangs are Los Angeles with 88 communities , Orange County with 27, and Riverside and San Bernardino with 18 communities, respectively.
According to the Justice Department report, gang activity nationally increased significantly in the 1970s and the 1990s but did not increase significantly in the 1980s. The report cites an increase in immigration and drug trafficking as possible reasons for the increase in gang activity.
To view the Justice Department report on gang activity in its entirety, please visit the Office of Juvenile Justice and Delinquency Prevention website at: http://www.ojjdp.ncjrs.org . To view the FBI preliminary crime rate data report please visit the FBI website at: http://www.fbi.gov .
CDC Report Released: Investment in Tobacco Control
The Centers for Disease Control and Prevention recently released a report, Investment in
Tobacco Control: State Highlights, 2001, which indicates that 45 states made a total investment of $883.2 million in public health programs in FY 2001 to decrease the prevalence of tobacco use in the country. The report provides state by state information on the prevalence of tobacco use, the health impact and cost associated with tobacco use, tobacco control funding and tobacco excise tax levels. The report also highlights successful prevention and education programs across the country.
According to the report the overall use of tobacco in California among adults age 18 and older is 18.7%, which is lower than the national median of 22.7%. Similarly tobacco use among youth in California is lower than the national level. Nationally, 9.2% of youth grades 6-8 report cigarette smoking and 12.8% report using any form of tobacco, but in California the numbers are lower with 6.7% and 10.0%, respectively. In grades 9-12 these numbers increase with 28.5% nationally reporting cigarette smoking and 21.6% in California. California also has a lower prevalence of lung cancer death rates than the rest of the country 31 per 100,000 population compared to 37.3 nationally.
The report also highlights California’s tobacco control program which began in January 1989 when the excise tax was increased from $0.10 to $0.35 per pack of cigarettes. The report indicates that tobacco use in the state declined throughout the 1990s at a rate of two to three times faster than that of the rest of the country. Between 1988 and 1999 per capita cigarette use in the state declined by almost 50% while the decline in the rest of the country was 20% and the prevalence of cigarette use among youth in California dropped by 43% between 1995 and 1999.
California according to the report has been in the forefront of tobacco control efforts in the U.S. To view the report in its entirety please visit the CDC website at http://www.cdc.gov .
Hollywood Writers Ratify New Contract
Hollywood writers recently voted in favor of a new contract setting aside $41 million for pay raises for members of the Writers Guild of America over the next three years. The previous writers’ contract expired last month, and there was widespread concern that the dispute between writers and the industry strike might have halted television and movie picture production and cost the Los Angeles economy billions of dollars. Other labor-management questions loom in the entertainment sector, with contracts with the Screen Actors Guild (SAG) and the American Federation of Television and Radio Artists (AFTRA) set to expire June 30. Contract negotiation talks are currently underway.
DOE To Receive $1.4 Million to Plan For Moab Uranium Tailings Move
The Office of Management and Budget announced this week that it is recommending the reprogramming of $1.4 million in FY2000 funds for the Department of Energy (DOE). DOE is expected to use the funds to draft a plan to move the uranium mine tailings pile adjacent to the Colorado River in Moab, Utah. After the plan is drafted, DOE will take over control of the pile this fall and plan its removal. The 10-ton tailings pile sits on the banks of the Colorado River, and contamination secreted from the uranium is considered a severe health risk to Californians and others who rely on Colorado River water.
Congress Approves Naming Federal Building for Late Rep. Corman
On May 24, the Senate passed S. 468 to designate the Federal building located at 6230 Van Nuys Boulevard in Van Nuys, California, as the "James C. Corman Federal Building". S. 468 was sponsored by Senators Dianne Feinstein and Barbara Boxer. On February 28, the House agreed to an identical bill, H.R. 621, by a vote of 413-0. The House bill was introduced by Rep. Howard Berman (Valley Village) and co-sponsored by several members of the California Congressional Delegation. Mr. Corman, a member of the California Congressional Delegation in the ’60s and ’70s, died late last year. He represented the San Fernando Valley area while in the House of Representatives.
Former Rep. Rogan Nominated To Head Patent & Trademark Office; Caldera to Join CSU
Former Rep. James Rogan has been nominated by President George W. Bush to be Undersecretary of Commerce for Intellectual Property, and Director of the Patent and Trademark Office. Rogan represented the 27th District of California, encompassing such Los Angeles suburbs as Glendale and Pasadena, from 1997 through 2000. During his tenure in the House, he worked on several intellectual property issues, and his former district includes the headquarters of many motion picture and entertainment companies.
In addition, former U.S. Secretary of the Army and California Assemblymember Louis Caldera was named this week to be the Vice Chancellor for University Advancement at the California State University. Caldera served in the California State Assembly from 1992 to 1997, when he was appointed by President Bill Clinton to head the Corporation for National Service, which administers the Americorps program. In 1998, he was nominated and confirmed as Army Secretary. Raised in Whittier, Caldera attended West Point and served in the Army before receiving a law degree and an MBA from Harvard University.
Agricultural Producers Urge President Not To Negotiate U.S. Trade Protection Laws
Over 100 agricultural producer groups, food companies, and rural communities, including more than 18 California growers of produce from asparagus to walnuts, are urging that U.S. trade protection laws not be negotiated at the upcoming WTO meeting. The coalition wrote President Bush on June 6 asking that U.S. antidumping and countervailing laws and Section 201 and 301 protections not be put on the negotiating table during the upcoming Multilateral Trade Negotiations. The group argued that some U.S. trading partners will mount an effort to negotiate these laws beginning with the Summit of the Americas and continuing through the WTO Ministerial in Doha, Qatar in November. The group fears that weakening of these laws will lead to abuse of the United States’ open markets and cause irreparable harm to U.S. agriculture interests. The letter also cites a recent letter signed by 63 Senators urging the Administration to make the retention of U.S. trade remedy laws a priority in the upcoming multilateral and bilateral negotiations.
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